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Panel: “The Big Picture With The Big Local Players”

At the Where 2.0 event in San Jose yesterday afternoon, Danny Sullivan moderated a panel entitled “The Big Picture from the Big Players.” In addition to Danny it featured Blaise Agüera y Arcas (Microsoft), Tom Wailes (Yahoo!), John Hanke (Google, Inc.), Dylan Swift (Yelp). The session sought to cover a lot of ground in a very tight 35 minutes.

Danny initiated the compressed session by asking the time-honored question about local online marketing and small business: “Why aren’t local businesses getting it?” Interestingly most of the panelists disagreed with that characterization.

John Hanke: “I feel like the stampede has started.” He added that “several million business” have used the local business center and later referenced Google’s simplified ads as directed toward small businesses.

Blaise Agüera y Arcas was more tempered: “It’s definitely accelerating but it’s still early.” He argued that there are millions and millions of local businesses in the US and this is a vast opportunity that remains largely untapped. (It’s really not that early in this discussion of small business and online marketing, but years from now 2009-2010 may be seen as the beginning of a new phase in the market.)

Yahoo’s Tom Wailes agreed with the notion that small business usage of online marketing is gaining momentum. However, he said that business owners are so busy and time starved, they need to see the ROI very directly. He argued that would be more apparent if online marketing were more directly tied in to offline sales and the POS system.

Reviews and local:

Danny then shifted to the topic of reviews, their integrity and how these sites protected against false or fraudulent reviews.

Dylan Swift discussed how Yelp protects the integrity of its reviews and described the Yelp algorithm and the site’s review filtering process. (This has been one of the things that has driven confusion and in some cases anger among some local businesses who don’t understand it. More recently Yelp has made a much bigger effort towards transparency in this process.)

John Hanke downplayed the danger of “scam reviews.” His response was that publishers should “raise the level of overall participation” rather than worry about filtering out negative reviews in particular. His view was that people can relatively easily spot fake reviews.

Tom Wailes advocated that “Reviews are good but they don’t go far enough in many cases.” He said that he sees recommendations as a complement or even successor to reviews.

John Hanke then added that he believed some of the new, simplified “dashboards” (analytics) being offered to small businesses were very beneficial and would help them see the value of online much more explicitly.

Street-level imagery:

John Hanke said he believed that Street View is “critical to local search.” Part of this is because of the images but part of it has to do with data collection. Said Hanke, Street View offers “ground truth about businesses: does it exist, where is it located?” This new method of data collection, he argued, contributes to a very precise local database.

Microsoft’s Blaise Agüera y Arcas agreed and lauded Google “for making investments before many of the use cases were obvious.” He then discussed the imagery as a “canvass” or the basis for layers and layers of data on top of that basic imagery. It also paves the way for augmented reality in maps (Bing Map Apps).

Dylan Swift said that Yelp focuses on photos inside businesses. He said that after Yelp added mobile check-ins to its new iPhone app, there was a huge increase in the number of images being uploaded by users.

Danny then raised the privacy question with street-level photography.

John Hanke argued that the genie is out of the bottle and this imagery is here to stay.

Blaise cited differing privacy laws in various countries and argued that some of them didn’t make sense. Everyone agreed with the “face blurring” that’s going on however.

On how mobile is changing local:

Tom Wailes asserted that it’s “fairly obvious how it’s changing local — convenience.” He argued that “Simpler local tasks are migrating aggressively to mobile.”

Dylan Swift discussed the immediacy of the user need in mobile — “tell me what’s good within 10 feet of where I’m standing right now” — and discussed the Yelp Monocle augmented reality tool.

Blaise: “Mobile is local; it’s really hard to draw the distinction. On the PC one could argue that maps is a vertical. On the mobile device maps isn’t a vertical. The entire context for everything that I do is about me and my location . . . often on foot.” He added that “spatial accuracy is very important.”

Hanke said he was “fascinated by mobile-local-social dynamics” and cited Foursquare as a exemplar of that development. “We’ve only begun the potential there.” Mobile and local “are wedded” at this point.

Danny then asked provocatively, “Will you be overtaken by the new check-in services?”

Dylan Swift jumped in, “Check-ins are a feature.” He said they “tie in nicely with the CRM aspects of our site.” Check-ins help local businesses see who their most loyal customers are.

Blaise: “We see ourselves as an ecosystem player; I get excited not distraught by what I’m seeing. I’m a big fan of Foursquare.”

Tom Wailes: “I’m very excited seeing these check in players. It’s very early too.” He said it’s hard to predict when and if the phenomenon will migrate to a mass audience. He said that Yahoo was a potential partner, rather than being threatened. He explained that Yahoo research has shown “Average users aren’t aware of this stuff yet,” adding that it will be “interesting to see how this evolves as it gets adopted by a mass audience.”

Hanke agreed: “We’re excited to work with these companies . . . We want to build inventory of great locally relevant ads. Previously the inventory wasn’t there.” He discusses some of the new simple ad products for local businesses from Google.

Tom Wailes: “Even users who haven’t heard of these services, they like the functionality especially coupons/discounts.”

Finally local and social:

Dylan Swift: “We’re at the early stages. This [local] is an obvious place for collaborative filtering to help get the most relevant recommendations to you.”

Blaise: “I want help to find where people like me go to eat. I wouldn’t trust any algorithm to know what I like; neither would I trust reviews in their current form.”

Tom Wailes: “Social and local . . . It’s about how to connect people to those who they can trust.”

Hanke: “Social is really important; there’s going to be more from Google on social and local.” He added that there’s a need to make features and functionality simple. “Most features are used by less than 5 percent of our users and we wind up throwing them away. We need more innovation around simple UIs coupled with great data.”

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About The Author

Greg Sterling is a Contributing Editor at Search Engine Land. He writes a personal blog, Screenwerk, about connecting the dots between digital media and real-world consumer behavior. He is also VP of Strategy and Insights for the Local Search Association. Follow him on Twitter or find him at Google+.